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Enphase Energy, Inc. is Attracting Investor Attention: Here is What You Should Know

Enphase Energy (NASDAQ: ENPH) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future. Shares of this solar technology company have returned -2.6% over the past month versus the Zacks S&P 500 composite's -4.5% change. The Zacks Solar industry, to which Enphase Energy belongs, has lost 2.4% over this period. Now the key question is: Where could the stock be headed in the near term? While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making. Revisions to Earnings Estimates Here at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock. We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. For the current quarter, Enphase ...